Ghana Government Seeks to Renegotiate Telecom Ghana Sale to Vodafone

­The Government of Ghana has reviewed the recently commissioned report into the sale of a majority stake in Telecom Ghana to Vodafone and says that it accepts the reviews findings to seek a new settlement with Vodafone.

Vodafone paid US$900 million on a debt-free, cash-free basis for the 70% stake but the review claimed that just US$267.6 million from the sale had been paid to the government due to "complicated financial arrangements", and that the sale might be illegal in Ghana due as it was managed through a Dutch holding company.

The re-engagement with Vodafone would also include issues relating to the operation of the National Fibre Optic Backbone which is considered a strategic national asset by many Ghanaians. The government said that it is "looking forward to the realization of the true value of the fibre optic backbone", which can be presumed to mean they want more money from Vodafone.

Government also said that it accepts the recommendation that in future, negotiations involving government must be handled by a team of technical experts and negotiators.

As recommended by the Committee, Vodafone GT would be expected to provide detailed reporting requirements based on audited accounting and reporting principles for the attention of the re-engagement team. Also to be considered is the possible return of some GT investments including landed properties and the Telecom Emporium to the Government of Ghana.

Government has also taken note of the Committee's findings in relation to the appalling financial state of Ghana Telecom before the sale to Vodafone which the Committee attributed to gross mismanagement, financial malpractices and irregularities when Telenor/Telecom Management Partners (TMP) were managing the company - and later the three-member Interim Management Committee (IMC).

Posted to the site on 4th November 2009